By Brett Sinsabaugh, CPA, CCA, Partner

IRS announces dollar limitations on pension plans and other retirement-related items
The Internal Revenue Service (IRS) announced cost of living adjustments to contribution limits for individual pension plans and other retirement-related items (Notice 2023-75). These limits become effective January 1, 2024.
The IRS raised the annual limits of Health Savings Accounts (HSAs) for individuals and families by more than seven percent in May 2023. This was the largest increase in the past few years.
A summary of the changes for qualified retirement plans and HSA plans is included below.
Highlights of retirement adjustments for 2024 vs 2023
Pension, HSA, and Other Retirement Related Limits
2024 | 2023 | |
---|---|---|
Employee Elective Deferral Limits - 401(k), 403(b) and 457 | $23,000 | $22,500 |
Contribution Limits - IRAs | $7,000 | $6,500 |
Defined Contribution Maximum | $69,000 | $66,000 |
Annual Compensation Maximum | $345,000 | $330,000 |
Highly Compensated Employee | $155,000 | $150,000 |
Catch-Up Contributions Limit - 401(k), 403(b) and 457 | $7,500 | $7,500 |
Catch-Up Contributions Limit - IRAs | $1,000 | $1,000 |
Key Employee | $220,000 | $215,000 |
Defined Benefit Maximum | $275,000 | $265,000 |
Health Savings Accounts (HSA): | ||
Individual | $4,150 | $3,850 |
Family | $8,300 | $7,750 |
Catch-up Contribution (age 55 and Older) | $1,000 | $1,000 |
Employers and employees should review these limit changes for planning purposes. Employers should be proactive in preparing for these limit changes by talking with plan recordkeepers or third-party administrators, etc. Please be mindful of limitations and timing differences impacting fiscal-year vs. calendar-year plans.
A detailed description of limits and thresholds can be found on the IRS website.
Keiter is focused on keeping you updated on new and changing regulations that may impact you and your business. Questions on this topic? Contact your Keiter Opportunity Advisor | Call: 804.747.0000
About the Author
The information contained within this article is provided for informational purposes only and is current as of the date published. Online readers are advised not to act upon this information without seeking the service of a professional accountant, as this article is not a substitute for obtaining accounting, tax, or financial advice from a professional accountant.